Global rating agencies Fitch Ratings and Moody’s Investors Service assigned ratings of ‘AA-’ and ‘Aa1’ respectively to GUC’s upcoming 2025A bonds while affirming those same ratings and a stable outlook for GUC’s current debt. Both ratings are considered “High Grade” and should help GUC at the time of the bond sales.
“Boosting or maintaining our credit rating is important because it allows us to achieve lower interest rates when we sell bonds to make needed improvements and upgrades to our infrastructure,” said GUC General Manager/CEO Tony Cannon. “Those lower rates mean we, and in the end our customers, pay less on the money we borrow. That is critical for us to be able to meet our mission of safely providing reliable utility solutions at the lowest reasonable cost.”
Fitch said, “The 'AA-' rating and Stable Outlook reflect Fitch's expectation that GUC will maintain its stable financial performance despite ongoing and significant utility system capital investments and planned debt financings.” Fitch added, “GUC's very strong operating risk assessment reflects its very low operating cost burden generated via its full-requirements member power sales agreement with the North Carolina Eastern Municipal Power Agency (NCEMPA). Operations at the water system remain solid and are supported by sufficient water supply and treatment capacity well in excess of average usage. The natural gas system's supply and storage service agreements are also supportive of sound long-term operating performance.”
Moody’s Aa1 rating “reflects our expectation of [the Commission’s] continued sound operating results and conservative management.” The agency also cited “The commission's independent rate setting authority has led to regular rate increases that are driving improvements in already sound financial operations.”
Earlier this year, a team from GUC met with Moody’s and Fitch in order to receive a rating for the upcoming bond sale. These meetings are routinely conducted to update each agency on GUC’s leadership, strategic vision, status of operations, five-year financial forecast, financial viability, regional economy and the utility’s ability to meet customers’ needs.
GUC is scheduled to sell bonds later this month to finance new capital projects such as improvements to our Electric System, Liquified Natural Gas Plant, and Water Treatment Plant’s lab.